On October 31st, Rohan Grey posted a 31-part Twitter thread about Rashida Tlaib’s and Alexandria Ocasio Cortez’s new Public Banking Act, which he helped craft. We immediately reached out and arranged for Steve to interview him, ending up with not one, but two episodes of Macro N Cheese. This week he answers our questions about the Public Banking Act. Next week he and Steve will venture into the swampland of politics. By the time the episode airs the election will truly - finally - be over. So, has anything changed? How does Rohan see the road going forward? But back to the Public Banking Act…
"It's long past time to open doors for people who have been systematically shut out and provide a better option for those grappling with the costs of simply trying to participate in an economy they have every right to—but has been rigged against them," Tlaib said in a statement. "The COVID-19 pandemic has also plunged city and state governments into a financial crisis unlike any other they've ever experienced—and public banks could offer a much more tenable option for dealing with their debts at a time when they need it most.” -- Newsweek
Instead of attempting to describe this interview, we’re going to let Rohan’s Twitter thread speak for itself:
First, some big picture comments about the bill
a) It does *not* create any new public banks. Rather, it *enables & encourages* the creation of public banks by establishing a comprehensive federal regulatory framework, grant programs, & supporting financial infrastructure.
b) It is designed to foster *state & local public banks*, not establish a federal public bank. In contrast to the federal govt, which issues the $US dollar, state & local govts face unique financial & monetary constraints that public banks can help alleviate.
c) It *complements, rather than competes with,* other progressive financial reforms, such as postal banking, FedAccounts, & eCash (on latter, see @RashidaTlaib’s #ABCAct). Together, they envision a new financial system that serves the people & promotes public purpose.
d) It does not make the mistake of treating public banks as an alternative to/substitute for federal spending & investment. Rather, it provides “top-down” support for “bottom-up” local initiatives, even while recognizing the critical need for more direct federal action.
e) Finally, it does not take a one-size-fits-all approach to the kinds of public banks eligible for federal support. Rather, it accommodates a wide variety of institutional structures and activities, from basic payments to consumer lending to public investment.
Okay, now let’s look at what the bill says...
The rest of the thread is published as an article on Real Progressives website. If you listen to Macro N Cheese on the website, don’t miss the EXTRAS section for each episode. This week it’s full of links leading to the complete text of the Public Banking Act, press releases, and articles.
Rohan Grey is an Assistant Professor of Law at Willamette University, the president of the Modern Money Network, and a director of the National Jobs for All Network. His research focuses on the law of money in the internet society.
@rohangrey on Twitter